Job Growth Does Better Than Expected In February - March 7, 2014

The nation's employment situation, in a pleasant surprise, brightened notably in February, notwithstanding the run of record low temperatures and heavy snowfall across the country over the past month and, for that matter, throughout this long and difficult winter.

Specifically, the government reported that the nation added 175,000 new jobs last month. That was better than the earlier estimate of 163,000 new payrolls and the latest forecast of 149,000 jobs. Also, data for December and January were revised upward. All told, the nation added 84,000 new hires in December (initially this number had been estimated at 75,000), while in January, the latest estimate showed the creation of 129,000 payrolls. Earlier that estimate had been given as 113,000 jobs.

At the same time, the unemployment rate ticked up slightly going from 6.6% to 6.7%. However, this slight increase did not affect the labor force participation rate, which remained unchanged at 63.0% in February. Also, the employment to population ratio held steady at 58.8%.

Meanwhile, as to where the jobs were, employment in professional and business services increased by 79,000 in February, while wholesale trade added 15,000 jobs. At the same time, food service employment rose by 21,000, but heath care jobs were little changed, as was retail trade, manufacturing, transportation, and financial services.

Further, the average workweek for all employees edged down by 0.1 hour to 34.2 hours. Average hourly earnings, meantime, rose by $0.09 to $24.31 an hour.

Taken as a whole, this was a good report, especially given the weather-related constraints during the latest month, and for that matter since November. It should be noted, however, that according to the government survey unusually severe weather is more likely to have an impact on average hourly earnings than on employment. "Average weekly hours are estimated for paid time during the pay period, including pay for holidays, sick leave, or other time off. The impact of severe weather on hours estimates typically, but not always, results in a reduction in average weekly hours.'' As noted, weekly hours, or the average workweek, dipped slightly last month.

At the time of the article's writing, the author did not have positions in any of the companies mentioned.